Francotyp-Postalia Presents Annual Report 2008
Birkenwerder, April 28, 2008
- FP Group confirms preliminary figures
- Revenues reached € 142.4 m
- EBITDA came to € 22.2 m, excluding restructuring
- Restructuring in progress
Francotyp-Postalia Holding AG, a worldwide service provider for the outgoing mail market, presents its Annual Report 2008 today. The report contains no significant changes to the preliminary figures released on February 24, 2008 - in fact, EBITDA was slightly better than previously reported.
Despite difficult economic conditions, the Francotyp-Postalia Group achieved total revenues of €142.4m in FY 2008, compared to €145.1m in the previous year. This downturn was due to the beginning recession in the Group's major markets, coupled with adverse exchange rates. Weaknesses in the US dollar, the pound Sterling and the Canadian dollar all had a negative effect on Group revenues, accounting for €4.9m in negative figures overall. When the negative exchange rates are factored out, revenues came to € 147.3 m.
Mailstream Revenues Continue to Grow Strongly
The FP Group's Mailstream segment proved to be the growth driver in FY 2008. Sales of the Group's mail services, such as the consolidation of business mail and digital mail processing, rose to €15.4m - compared to €8.5 m in the previous year.
However, adverse exchange rates and the global recession affected the Group's traditional Mailroom Business with revenues down at €127.0m, compared to €136.6m in the previous year. While sales in the US, Canada and the Netherlands were lower, business with franking and inserting machines in the Group's domestic market in Germany remained stable despite the weak economy. Revenues here reached €46.8m, compared to €47.7m in 2007. With a 43.8% share in the market, the FP Group has buttressed its market leader position in Germany.
Restructuring Affects Results
Adverse exchange rates and the global recession had a negative impact on results. Further, the costs of restructuring the Mailroom Business came along. As a result, EBITDA in the reporting year came to €18.2m, compared to €25.2m in 2007.
Adjusted for restructuring costs, the FP Group's EBITDA came to €22.2m in 2008. Restructuring charges totalled €4.0m, of which €1.4m were personnel expenses - in particular, compensation to former Management Board members - while €2.6m were booked to other operating expenses. Negative currency effects pushed results down by a further €2.7 m. However, when negative exchange rates and restructuring costs are both factored out, EBITDA came to €24.9m in 2008 - the same level as in previous year.
The consolidated net result for FY 2008 came to - €15.7m, compared to - €2.8m in 2007. Aside from lower EBITDA, this result is due to one-off write-downs totalling €5.1m as part of the restructuring process.
But irrespective of the negative effects caused by restructuring and changes in currency exchange rates, the FP Group's operative business did remain comparatively stable, despite the global recession. The Company recorded a positive cash flow of €18.7m from operative business in 2008, compared to €19.4m in the previous year.
Restructuring Improves Processes
The restructuring started by the FP Group in the autumn of 2007, focussed on three main areas - optimisation of research and development, business administration and supply chain - have been partially completed already in 2008. Regarding research and development, the FP Group has involved customers in new projects, as well as standardised individual components and processes. In the business administration field, the Company has tightened up processes, particularly in sales and marketing and the contracts departments, thereby reducing personnel expenses.
Now, only the supply chain remains and is being optimised by the FP Group in the current year using internal resources. By tightening up the production and supply chain, the FP Group expects to slash delivery time, and to reduce inventory holdings significantly. At the same time, process costs in production and delivery will be reduced.
Global Recession Clouds Outlook
The deep recession continued to exert its grip on the FP Group's major markets in the first months of the current year. This makes it impossible to give any quantitative forecasts for the current financial year. According to the CFO Hans Szymanski, "With our new strategic alignment and the ongoing restructuring, the FP Group will create a new foundation for the sustained strengthening of its operative business over the medium term. In 2009, our sales business is mainly focussed on convincing existing and new customers of the efficiency and cost savings that our mail management solutions offer for outbound mail." The CFO also pointed out that two-thirds of the FP Group's revenue is generated from after-sales business which supports and stabilises the core business.
Full details on the Company's annual financial statement are available on our website at:
http://www.francotyp.com
Contact
Francotyp Postalia Holding AG
Investor Relations
Sabina Prüser
Tel: +49 (0)3303 525 410
Fax: +49 (0)3303 53707 410
E-mail: s.prueser(at)francotyp.com
The FP Group in Brief
Francotyp-Postalia Holding AG (FP Group) is a leading manufacturer of franking machines covering the whole value added chain in the outbound mail market. Its products and services range from franking and inserting machines to the collection, sorting and consolidation of outbound mail, as well as electronic hybrid mail solutions offering 21st century mail processing. With its headquarters in Birkenwerder near Berlin, the FP Group offers businesses of all sizes individually tailored mail management solutions. The FP Group has local branches in many industrialised countries and currently holds over 9% of the worldwide franking machine market. With a corporate history extending back over 85 years, today the FP Group is profiting from the growing liberalisation of mail markets and the increasing interest of businesses to delegate their outbound mail operations to professional service providers. In financial 2008, the Group employed around 1,100 people, with revenue of 142.4 million euros and an EBITDA of 18.2 million euros.
